Power shortages, bird flu hit South Africa's poultry supply

In a trading update, Astral said it expects to report a total loss of between R18.02 and R18.08 ($0.9564-$0.9596 ) per share for the year to September 30, compared with a profit of R27.62 last year, mainly due to production cuts due to persistent power supply problems. 

Astral said the power crisis had disrupted the poultry industry and increased operating costs, which were now being compounded by additional costs associated with the "worst-ever" outbreak of bird flu that has spread across the South African provinces of Gauteng and Mpumalanga "at an alarming rate".

"Bird flu has already led to a shortage of table egg supplies to the market and it is expected that poultry supplies to the value chain may be reduced in the coming months," Astral said.

Africa's most advanced economy is suffering from frequent power outages, driven by an ageing fleet of coal-fired power plants. State utility Eskom regularly reduces power to businesses and households for several hours a day, a process called local load shedding.

Companies have had to spend millions on alternative energy sources such as diesel generators and solar power plants. In the poultry sector, unstable power supplies affect ventilation systems, slaughter schedules and chicken processing.